Vice President JD Vance said Thursday that things “could be worse” after the stock market posted its single worst day since June 2020 in response to President Donald Trump‘s plan to impose sweeping tariffs on more than 180 countries.
The Context
Trump announced on Wednesday that he would slap at least a 10 percent “baseline” tariff on all imports. He also singled out about 60 countries that would face what he described as “discounted reciprocal tariffs” over their trade policies, which Trump believes are unfair.
U.S. and global markets reeled on Thursday as economists, analysts and investors sounded the alarm about the potentially devastating impact Trump’s tariffs could have on the global economy.
World leaders also pledged to retaliate, though some struck a more measured tone by refraining from commenting or saying they would continue working with the U.S. on a trade deal.
What To Know
Asked what his reaction was to the stock market plunging, Vance told Newsmax: “We’re feeling good. Look, I frankly thought in some ways it could be worse in the markets because this is a big transition.”
He went on to reference Trump’s remarks from earlier in the day, in which the president said his tariffs were akin to performing an “operation” on a sick person. He also said markets would “boom” as a result of the tariff policy.
“You saw the president said earlier today: It’s like a patient who was very sick. We did the operation and now it’s time to make the patient better,” Vance told Newsmax. “And that’s exactly what we’re doing.”
He continued: “Look, one bad day in the stock market compared to what President Trump said earlier today, and I think he’s right about this, we’re going to have a booming stock market for a long time because we’re reinvesting in the United States of America.”
“More importantly than that,” he added, “of course the people in Wall Street have done well. We want them to do well. But what we care the most about are American workers and about American small businesses and they’re the ones who are really going to benefit from these policies.”
The S&P 500 index was down 4.84 percent at market close on Thursday—its worst day since June 2020—as Trump’s tariffs sparked a global sell-off.
The tech-heavy Nasdaq tumbled 5.97 percent, its biggest drop since March 2020. The Dow Jones Industrial Average closed down 3.98 percent.
Stock futures also fell after market close, with the Invesco QQQ ETF, which tracks the Nasdaq, losing 0.15 percent. The SPDR S&P 500 ETF Trust (SPY) lost 0.07 percent and the SPDR Dow Jones Industrial Average ETF Trust (DIA) lost 0.24 percent.
The U.S. dollar also wiped out all its gains since Trump’s reelection in November.
What People Are Saying
Less than an hour before the market had its worst day in five years, Trump told reporters: “The markets are going to boom, the stock is going to boom, the country’s going to boom. And the rest of the world wants to see, is there any way they can make a deal. They’ve taken advantage of us for many, many years. And many years we’ve been at the wrong side of the ball and I’ll tell you what, I think it’s going to be unbelievable.”
Gordon Hanson, professor of urban policy at Harvard Kennedy School, told CNN: “It’s possible to bring some jobs back, but not enough to restore what I think the Trump administration is trying to accomplish, and that is to take us back to 1950, when manufacturing accounted for 35 percent of employment in America and provided good jobs for workers without a college education, allowing them to attain the American dream: the middle-class lifestyle.
“Today … you’re not creating substantial numbers of good jobs [in manufacturing]. That’s got to happen in services, it’s got to happen in health care, it’s got to happen in information technology, targeted towards workers without a college degree.”
Mary Ann Bartels, chief investment strategist at Sanctuary Wealth, told CNBC: “This was the worst-case scenario for tariffs and [they] were not priced into the markets, which is why we are seeing such a risk-off reaction.”
What Happens Next
A 25 percent tariff on auto imports went into effect on Thursday. The 10 percent “baseline” tariffs will take effect on April 5 and the reciprocal tariffs will kick in on April 9.
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